Do you want to build your own video production business but aren’t sure where to start? Or maybe you already do a few projects here and there, but you want to take the plunge into full-time work. Let me share with you some of the things I’ve learned in building my video editing business.
I started my video editing company, Renegade Digital Post, in October 2015, and business has steadily increased. I’m not yet working outside my living room, but I am laying a solid foundation to see my business take off by the end of this year.
In the beginning of business-building, you first have to answer the question, "Do I want to be a business owner or a freelancer?" These are two different approaches to your work, and two very different mind-sets:
Freelancers work for themselves. The idea is to get enough work throughout the year to make a living. It’s just you, your clients, and your work. The only catch is that if you stop working for some reason, your income disappears as well.
Business owners want to move from being the only one on the production floor to overseeing production done by other people. The idea is to build an income source so that if you decide to take a four week excursion to the Grand Canyon, your rent still get’s paid because your little army is working while you’re gone.
The next question you need to answer is, "What service am I going to offer?" After doing the one-woman production crew thing for most of my professional life, I was exhausted from doing it all. My best strengths lie in editing video footage together. I decided pretty early on that Renegade Digital Post would only offer video-editing services. No shooting footage.
As an editor outside of Hollywood, this is a risk. Unlike those working in LA, my chances of being roped into a full film crew are pretty limited. And most businesses and individuals that want video work produced want the whole package: pre-production, shoot, edit, file ready for distribution.
The decision to offer only video editing narrowed my client base considerably. But knowing the answer to this question helped me define my target client. I don’t work with businesses (necessarily) to produce video content. My ideal clients are small production companies or one-man producer crews who are maxed out in their project schedule. They’re people who love to shoot and hate to edit. And this fact makes selling my services much easier to do.
As you design your business and think about the skills and products you want to offer, you also have to answer the question, "What problem am I trying to solve?" Going into business without a problem to solve makes your services and products much harder to sell. They’re not needed. Or wanted. But solutions to problems are always in demand.
You vs. Everybody Else With a NLE
Positioning your work and business is critical, whether you’re relying on word-of-mouth or utilizing an ad strategy to find clients. Because seriously, what makes you any different from the next guy with a computer and a NLE?
Think of it this way: what’s the difference between Chipotle and Qdoba? Answer: not much. They’re both fast-service burrito makers. However, one positions itself as a place of wholesome food ingredients, the other as a place where you don’t pay for extras. And people choose to eat at either place based solely on that positioning.
Likewise, clients will choose to work with you based on your positioning. This goes back to the point I made earlier: if you know what problem your business solves, then you have to find people who have that problem in order to make money. And how you offer that solution through your communication streams is how you position your work. This includes when you talk about your business in conversation and online, as well as when advertising and promoting your services.
Another way positioning is reflected in your business name. For some business owners, their business name is the same as their personal name. In my case--well, it’s kind of obvious Renegade Digital Post is not my personal name--however, the other name I considered was Denver Digital Post. After all, I’m in Denver, Colorado and I’m offering post production services for digital media.
However, this had two problems. One, a Denver newspaper is called the "Denver Post". Two, the name was too stuffy. I wanted people to think of my media company as a place where filmmakers could get Hollywood-caliber editing services and escape from their post-production prison. You can’t get that at Denver Digital, but you can get it at Renegade Digital Post.
Positioning is reflected in how you talk about your services and products. The words you choose to use as you talk about your company must reflect the solution you’re offering. It’s just like the stories you cut as an editor or create as a filmmaker: everything in your film must augment the story you’re telling, reinforce the strength of the characters, and make it believable.
Cashflow & Shiny Objects
The biggest thing you need as a business owner is what’s called "cashflow." This is not just money going in and out of your bank account. It’s money coming in, going into other areas of the business, and making more money before going out.
The idea is grounded in assets vs. expenses: an asset makes money because of what it does. An expense leaks month every month. The differences between assets and expenses are something any business owner has to understand. Expenses leak money. Assets make money. Businesses make money by having enough assets to cover expenses and then some. This is how profit is generated.
In my case, my editing computer is an asset because it’s the workhorse of my company and every project I complete on it makes money. When I hire an editing assistant in the future, he or she will be an asset because they help finish projects that also make money.
Expenses can be tricky because some of them are needed in order to succeed. However, some expenses aren’t necessary and a wise business owner has to learn how to tell the difference. For example, when I hire an assistant, she will be an asset. But her salary is a necessary expense. At the moment, however, office rent is an unnecessary expense for me. Let me illustrate:
Renegade Digital Post currently operates out of my living room. Paying rent on an office space would mean a monthly payment just to have a place to put my editing computer. I don’t have kids running around all day, so my living room is as private a workplace as an office would be--and maybe even better because literally no one can interrupt me. In my situation, office rent would be an unnecessary expense that’s not contributing any income to the bottom line.
Yes, I could write off my office rent as an expense at the end of the year when I do my taxes. However, if my business expenses are costing me all I’m making, I’m not making any profit month to month. And profit is kind of the point of owning a business, right?
In determining to keep my overhead as low as possible, I’m also avoiding what’s nicknamed “Shiny Object Syndrome.” This is a trap of business ownership that many first-time business builders fall into. They buy everything they think their business needs the second they get their first credit card. For some owners, it’s pretty new staplers. In the video-editing business, my Shiny Object could be an expensive piece of software. Rather than buy what I think I might need just because I have money, I’m making a point of buying what I need, when I need it. By not spending extra money on Shiny Objects, I can use that money to build more assets.
I get asked this one all the time: "How do you find clients?" A large part of my work in the last eight months has come through word-of-mouth and through my network of professionals and friends. I’ve gotten jobs from Twitter, from random conversations with people while on vacation, and just plain ol’ friends hooking me up.
Word-of-mouth is a great place to start building your business. Don’t underestimate the power of your network. Listen to conversations with friends, and pay attention to what they need. "I might be able to help you with that," is a great phrase to remember. Be proactive on social networks when you see someone asking for help in your area of expertise. Some of my projects have come from the most unlikely places because I was paying attention to what people needed.
However, only word-of-mouth can be a lousy place to remain if your goal is to get out of your living room and have other people working for you. And believe me, I’m tired of working out of my living room. This is why I’m utilizing other ways to grow my circle of clients.
Getting beyond relying on word-of-mouth is critical in any business-building plan. Two key ways to grow are in referrals and through advertising.
Referrals are exactly what they sound like: asking your current clients if they know of anybody else who could need your products and services. While this can frequently result in a no, there’s another kind of referral to ask for: a recommendation that you can post on your website. In a day an age where users scour ratings and reviews before doing business, you can’t be without these.
Advertising comes in two different forms: free and paid. Free can include both free networks like Twitter, Instagram and Facebook, as well as referrals and word-of-mouth. Paid advertising includes Facebook ads, Google AdWords, newspapers and magazines, radio ads, etc.
The key to successful advertising is getting your message in front of people who will actually want your product. This is the best way to get more paying customers, and thereby, make money. Without this targeting, advertising becomes an expense rather than a revenue stream. Learning how to accomplish this is key. Even if you eventually farm the work out to a marketing company, knowing how it’s done will empower you to get the most bang for your buck.
Only Going Up From Here
In the beginning, business building is challenging. You have to not only think about how your business will grow and move forward, but you also have to get all the work done yourself. This includes doing the services and making the products you offer. But is also includes hundreds of of other details like paperwork, accounting, client management, and pitching.
This stage of “doing everything that needs to be done” is nicknamed bootstrapping, because you’re pulling your company up by your own bootstraps. However, bootstrapping is not a long-term business model. The goal is getting out of it as quickly and sustainably as you can.
The critical key is scaling up and continuing to grow the income coming into your business each month. This is where I’m at in my business. My goal is not to be doing all this work myself. Instead, my goal is to find enough clients and customers where I have a good enough reason to get Renegade Digital Post out of my living room, I can hire an assistant to help me get work done, and I can partner with outside expertise to accomplish tasks such as my taxes, bookkeeping, IT, and the like.
Many business owners start without a clear picture of where they’re going. As a result, they waste time and money developing products and services that nobody wants to purchase. Or, their offerings change with each passing fad. Some never understand the concept of cashflow and end up mired in business debt. Others are so scared by the unknowns they never take the risk and get started.
This does not have to be you. I believe that you can build your own post-production or video editing company and that you can and will be successful! Starting with the foundational concepts explored in this post will get you on the right path to building your business from the ground up!
For more on the ideas expressed in this post, I recommend you check out: “Rich Dad, Poor Dad” by Robert Kiyosaki, “The Four-Hour Workweek” by Timothy Ferriss, “The 80/20 Guide to Sales and Marketing” by Perry Marshall, and “I’m a Freaking Genius, Why Is This Business So Hard?” by Mike Campion